Burke Linked To Payroll Scandal

Ghost Worked For His Firm, Not City Council

Had it not been for a few crucial details revealed Thursday--such as the name of his employer and political sponsor--Joseph A. Martinez would have likely been another semi-anonymous crook in a long-simmering scandal, the 27th defendant and nothing more.

But Martinez is the first to bring the scandal close to the door of Ald. Ed Burke, so the reverberations of his case were being felt in City Hall and in Burke's fiefdom in the 14th Ward.

FOR THE RECORD - Corrections and clarifications.This story misidentifies state Rep. Miguel Santiago. The Tribune regrets the error.

Martinez admitted in federal court that he held ghost jobs with three different City Council committees at the same time he was a full-time employee at Burke's law firm.

Among his ghost jobs, Martinez revealed, was a position on the Finance Committee, which is led by Burke, known as one of the city's most powerful and savvy aldermen.

Martinez, an alderman for 1 1/2 years in the early 1980s, pleaded guilty to receiving more than $90,000 in pay and benefits, despite doing no work while on the payroll of the three committees for 6 1/2 years.

Martinez has been cooperating in the continuing federal investigation of ghost payrolling at City Hall, dubbed Operation Haunted Hall, prosecutors disclosed.

Sources said he has been working with authorities for more than a year.

After Martinez's guilty plea, his lawyer, Richard Garmer, said that Burke had placed his client with all three council committees so that Martinez could receive health insurance coverage.

Burke's law firm, Klafter and Burke, didn't provide health benefits at the time.

Burke was "well aware" that Martinez wouldn't do any work for the committees because Martinez was working full time for his law firm, Garmer maintained.

Martinez "did not actively pursue those positions," Garmer said. "He was appointed to them . . . by his employer, Mr. Burke."

Martinez has worked for Burke since 1981.

Minutes after Garmer implicated him, Burke left his City Hall offices, brushed past reporters in the lobby and crossed LaSalle Street, where his driver was waiting in a dark-blue Crown Victoria sedan.

Responding to questions about Martinez, Burke said: "It was not my committeee. No. He worked for the Transportation Committee."

Asked if he had knowledge that Martinez was working for his law firm while allegedly doing no work for the City Council, Burke said: "I have no comment."

Word that the ghost-payrolling scandal has brushed so close to Burke did not entirely surprise some City Hall veterans.

"They been sniffin' around him for years. Maybe they'll get him, maybe they won't," said an alderman, referring to U.S. Department of Justice investigators.

Others figured the Martinez flap would turn out to be a minor one. "Don't be writing Burke's obituary just yet," said another City Hall politician.

Burke has been reluctant in recent months to talk about the ghost-payrolling probe.

But in January 1995, he commented on the scandal--months after Marie D'Amico, daughter of former Ald. Anthony Laurino (39th), pleaded guilty to ghost payrolling.

Laurino was indicted on charges of doling out dozens of ghost jobs during nearly 20 years as chairman of the Traffic Committee, but ill health will likely keep him from undergoing trial.

At that time, Burke blamed a dead man, Horace Lindsay, D'Amico's Finance Committee supervisor, for forging time sheets to cover her behavior. He said neither he nor Stephen M. Murray, the Finance Committee's chief administrative officer, could have known about D'Amico's ghosting.

"I don't supervise the personnel," Burke said. "Do you expect I should know where everybody is, all 75 or 80 people or whoever's there?"

In the past, Burke has vowed to take a hard line on ghosts.

"I can assure you this," he said. "My instructions to Mr. Murray have always been, if I've said it once, I've said it 500 times: `If they don't work, terminate them.' "

Burke might have a more difficult time dismissing Martinez's ghost job on the Finance Committee because "this was right under Burke's nose," a source said.

Martinez, 51, was charged Thursday morning and hours later pleaded guilty in District Judge Ruben Castillo's courtroom to a felony count of theft of government funds.

He pleaded guilty to holding a ghost job on the Traffic Committee from May 1988 to April 1992. As part of his plea agreement, Martinez also admitted he did no work while on the payrolls of the Finance Committee from August 1985 to May 1987 and on the Land Acquisition Committee from May 1987 to March 1988.

During those 6 1/2 years, he collected $53,145 in pay and $37,352 in health insurance coverage. Martinez has made full restitution.

Martinez was a precinct captain in the 31st Ward Democratic Organization and a protege of Thomas Keane, the city's most powerful alderman under Mayor Richard J. Daley.

In December 1981, then-Mayor Jane Byrne, under pressure to name a Hispanic to the City Council, appointed Martinez, a native of Puerto Rico, as alderman of the 31st Ward.

When the ward's Democratic committeeman backed now-state Sen. Miguel Santiago for the aldermanic seat, Martinez decided against seeking election and left the council in April 1983.

According to city records obtained by the Tribune, Martinez joined the Finance Committee at a monthly salary of $1,033 on Aug. 1, 1985, when it was headed by Burke.

When Mayor Harold Washington gained control of the City Council, Burke was ousted as Finance Committee chairman and Martinez lost that job May 15, 1987.

The next day, he joined the Land Acquisition Committee, according to records and Martinez's plea agreement.

"Government payrolls are not personal piggy banks for politicians," U.S. Atty. Jim Burns said of the charges against Martinez. PHOTO (color): Joseph A. Martinez (left) leaves the Dirksen Federal Building after Thursday's court appearance. Tribune photo by John Kringas.